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Tuesday, October 04, 2005

The Indian Non-competitive-ness

A recent report rates India 50th in ranking of Competitive Nations. Some might argue that it ranks many other country like China(49) and France(47) bad too. But should that give us enough excuse for that poor rank?

Thinking of our competitiveness, let see where India(n) is(are) performing good. We are reportedly one of the best in getting outsourced work. Besides being a cheap and abundant source of people the credit goes mainly to our 'English' knowledge and capabilities rather than our actual software expertise.

What is not realized in the whole matter is that though the economy as a whole is growing with Foreign companies coming in and setting their offices in India, there is hardly any growth in the direction of India becoming a developed nation forget about being a super-power. Hardly any Indian company makes it to the fortune 500. Hardly any hardware company we hear of or whose product we use is Indian. Our Automobile companies aren't any globally competitive, once the foreign companies start competing aggressively within India the remaining Indian businesses will surely not be able handle the aggression.

Take China on other side, China is slowly becoming the manufacturing capital of the world. Name any hardware bussiness and Chinese companies are natively producing that, be it chips or printer or even Routers. Similar is the position of Japan, which is already the centre of Electronic Innovations.

Is there any chance of India achieving the developed nation status by even 2020 ( or we have to postpone the target year once again as usual)

4 comments:

good post..people(read indians) should really realize their potential and start reigning rather than serving the world...the problem with these industries (automobiles and hardware) is that the starting cost is too high and chances to compete in an existing market and still being able to persist are poor. You must have heard of some poor TV etc brands that belong to india like T-series etc..but where did they reach..Even Indian government (like china) should support Indians to start off on their own..India itself has a huge market potential in all the fields now, be it computers, laptops, mobiles or anything...if an Indian company can do well in India it surely can do well globally...

and yes..this India shining sux...india is not at all shining..most of the MNCs that export (read outsource) work to India give only that work which they dont want to waste time in or to get it done cheaper...India is gaining through it, but there is no Innovation in that...I am not saying we should stop it as outsourcing is one chief source of employment..but just doing the outsourced work wont take India (or moreover Indians) anywhere..

I agree with India not working to its full potential but lets not compare the situation with China; there are many other issues we are not taking into account when we compare these two countries: censorship of free-media & communication. Are you even aware how bad the situation is in north china.

The "India Shining"s or the "Feel Good Factor"s are all the political things... Lets not get them into our heads...But the thing is that India surely is progressing, may be at a snails pace and may be not upto our expectations .. but as usual every Indian always has too much expectations from India...

And I would like to disagree to a certain extent about the point that we are not progressing in the manufacturing sector... I think this is a general misconception.. Infact our automobile sector is doing gr8.. dont know about the actual stats but Maruti Udyog and Hero Honda are the largest no or Car/Motorbike producers in the world and their market is not only India but other nations also ... The best thing is that Indian Brands are now seen with respect in other parts of the world .. All thanks to Tata Motors (Indica) and Mahindra&Mahindra(Scorpio), now we have Indian products with world class standards...

And about the Good English& Cheap Labour thing... its very true .. but its not complete ... surely we speak better English in the subcontinent and we do have a large poole of labour[well the cheap part is limited to certain segments only]... but I think probably the main reason for which all MNCs are coming to India is about the quality of Indian talent... and Its not only my words, there are many who believe in it, the best example would be of Jack Welch...

Rocky: Thanks for correcting my mis-knowledge about India's position in Auto Mobile industry, I basically got the Idea about Indian companies not performing good by the fact that For no particular thing (except for Cycles may be) India is considered the leader in the world. Innovationwise we are almost zero. Yes producing economical cars is one thing Tata Motor have acheived and I must congratulate them. But think of a dream car and most probably it wont be one from Maruti or Tata either. Think of an affordable car it might be. The idea should be think of a dream and affordable car it should be Indian. (I do think Boleno is step towards it, Tatas jeeps are also doing good). And Ofcourse ONGC is my favourite Indian PSU.

Porna: Recently Jagmohan a friend of mine informed me (mind you he always has genuine news direct from some great source), that in 2020 or 50 (don't remember exactly) India will be just the third economic super power in the world directly behind US and China, but the Gap between China and India will be MUCH MUCH large.Chinese really don't have the democracy thing and its bad, but thinking of the kind of leaders India is producing (exception current PM and FM and president) Democracy doesn't help India reach its potentiall viable goal of economic strengh and superpower. Japanese on the other hand have proved that its not the government instability which can keep them behind, They have worse records of Government stability but you must agree they are much more competitive.